Frequently Asked Questions
When it comes to a Jumbo Loan, your down payment will depend on several factors. For instance, your credit score will play a big factor in your down payment options. The higher your credit score, the lower your down payment might be. Another factor to consider is your cash reserves. You’ll likely need to show you have enough cash in the bank to cover your loan for a certain period. This could also help to reduce the required down payment. Keep in mind, though, that the higher your down payment, the less you’ll pay month to month.
Jumbo Loans aren’t backed by the government, which means the credit score qualifications are set by the lender. The larger loan amounts are a risk for lenders, so the credit score qualifications are a little more difficult than other loan options. Many lenders require a FICO score of 700 or higher, though some go as low as 680. To learn more about the credit score qualifications, contact a mortgage consultant.
Private mortgage insurance or PMI is typically reserved for loans with a smaller down payment option. Because some Jumbo Loans require a higher down payment, you may not be required to pay PMI. However, if you can make a smaller down payment on your loan, then you might have to pay PMI. It’s best to discuss this with a mortgage consultant and learn about your options.
Jumbo Loan limits are designed to help borrowers purchase homes priced beyond conventional loan limits. Because of this, Jumbo Loans typically start at around $424,000. Each lender sets their limits. To learn more about the limits in your area, contact a mortgage consultant.